What the Cannabis Act of 2018 in Canada Means for the Investors

 

The cannabis industry is quickly becoming big business. Last year, for the very first time, U.S. consumer spending eclipsed $10 billion. It is expected that this expenditure will increase to $ 23 billion by 2022. Currently, 33 states including Washington, DC have legalized medical cannabis programs, and 11 states have legalized cannabis for adult use. As more and more states legalize cannabis, the cannabis industry continues to improve.

After imposing Canada’s Cannabis Act of 2018, it legalized the sale of 30 grams of cannabis to adults from government-licensed shops. According to the Canadian Prime Minister Justin Trudeau, ‘The Cannabis Act’ is created for better the health and safety of Canadians, to keep cannabis out of the reach of youth, and to stop criminals from making profit. Want to know about cannabis investment opportunities? Scroll the page and know what things you should keep in your mind if you want to invest in the cannabis industry.

As the industry and investors prepare for the establishment of a brand-new world of cannabis in Canada, several companies participated in this historic event, and the news that followed immediately showed the momentum witnessed by the industry. Executives in the marijuana industry also predicted a chain reaction: new regulations force neighboring countries to legalize to prevent tax losses. They say that more legal states increase the likelihood that the government will take action to remove restrictions at the national level.

Many leading cannabis companies today enjoy the benefits of high company valuations. Although this is enough to persuade some investors to join the game, it is important to remember that a company's valuation depends largely on market hype. Since the cannabis industry is relatively new and has not yet been verified, it is not clear whether the market valuations we are seeing will stabilize. If investors end up overestimating the potential of the legal field of cannabis, these valuations may eventually fall. Although all states are working towards the legalization of marijuana, efforts to legalize marijuana nationwide are still far away. Investors should note that federal legalization is certainly not guaranteed. This means that companies face very different regulations based on their country/region.

Investors who want to invest in the legal cannabis industry should remember that this sector is very crowded. Hundreds of companies are competing for dominance in a developing global industry. Among these companies, very few will become major players in the market. Many other companies may remain small or even close operations under market pressure. Some stocks are safer than others, but for everyday investors, it is difficult to predict which companies will become the best or worst. You can take help of any online investment community if you want to know cannabis investment opportunities in the future.